Quote:
Originally Posted by DaFace
This past year has certainly been an interesting case study in how stock price and financial performance are loosely linked at best.
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Yeah, the market was up last year, notably up, while the economy tanked. I know that the market prices in future performance, but future performance is needed just to get back to where we were two years ago. So why is the market 15 percent higher than that? It's not bargain shopping because it's at a premium. I follow the tried and true mantra of not trying to time the market, but I really can't figure out how we're going to have an overperforming market for the next two years if there's any connection at all to the real world.
And that's not even considering my big picture question of how the market outperforms inflation over time. It leads to bigger and bigger discrepancies between the stock market and the rest of the world.
It's kind of the only game in town so I keep playing it, but I try not to think about what the foundation is under this big house of cards.